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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (30164)	4/8/2003 11:27:45 AM
From: SliderOnTheBlack	Read Replies (4) \| Respond to of 36161

Kaplan's "Very Strong Bullish" call ? ...just another "airball call" thrown out there vis a vie - Mr. Hype/Sinclair's call for a POG rally no later than the end of last week & that the correction/reaction was now over. Kaplan's reasoning is seriously flawed - ie: quote/unquote ["As of this morning, when gold touched $319.30, its lowest point since December 2, 2002, Comex gold commercials were probably net long for the first time since December 2001, thus confirming a strong buy signal on both gold and its shares."] "Probably" doesn't cut it.... but, on the subject of the Commercials - The PermaBulls got the Commercials mindset wrong on the ramp from $350 to $390 where they built record short levels - babbling that POG was ready to blast thru $450 because of the coming massive short covering...that the record short levels were a quote/unquote "extremely bullish signal" - yada, yada, yada... only to see that record short position turn extremely profitable as POG collapsed from $390 to $319 here of late. - now are the Commercials covering ? - yes, of course they are - that's why they are commercials...they take their profits...and why wouldn't they ? - look at the profitability of their trade (vbg). The high-probability of Saddam's death is obviously a prudent short-covering event catalyst...and that is what is propping up both POG and Goldstocks presently.... SHORT COVERING. There is ZERO, NADA- NONE; significant fresh inflow of funds into Gold mutual funds, or individual stocks here.... Z-E-R-O. Once the short-covering/profit taking ends here... we'll see what kind of "REAL" buying interest exists for both POG and goldstocks. The Perma-Bulls on Gold have made 5 consecutive, significant mis-calls on this market. 1. They threw in the towel on the October pullbacks as the broad market rallied heavilly - on news indicating a potential UN resolution with Iraq...missing the 100% probability of War with Iraq...and that was the last significant High Reward/Low Risk - buying/long opp in Gold. 2. Then they misunderstood "WHO" was buying Gold & goldstocks long and "WHY" they were....ie: a War Hedge...nothing more, nothing less....as this is now quite obviously what propelled both the Oct to Dec Gold Rally and the corresponding selloff in both POG and Goldstocks - to the present. 3. They missed the Selling/Profit Taking EXIT opp into Dec thru Jan....because they believed that underlying fundamental catalysts "other" than a War Hedge were propelling that rally. 4. They have continually held, or even added here into the collapse from HUI 155 all the way down to 115-120 & POG $390 to $319. 5. They are now misinterpreting the Short Covering from the Commercials as a signal that they are also going to go significantly long here....again imho, WRONG.... the Comm's will wait for $307-$311 imho and the Hedge Fund Goldstock buyers, will wait for a breach of HUI 105. More importantly than any potential interim trading bounce - and yes, it's tradeable...but, the most significant issue in POG - is that if we move into a complete control of Baghdad and begin transitioning to the new Government...there is NOTHING on the immediate horizon to propel Gold, or Goldstocks significantly higher... NOTHING. The fundamental catalyst moving Goldstocks to their recent double-top high - was GEOPOLITICS and the WAR HEDGE in POG. The other fundamental catalysts of the USD & the Economy are going to take a much longer period of time to deteriorate to levels required to propel gold & goldstocks to significant new highs...ie: HUI 200 and $425+ POG...and when and if that deterioration occurs... we will all have plenty of time (as well as "some of us" having plenty of retained profits - read CA$H) to redeploy into the next HIGH REWARD - LOW RISK opportunity in the Gold Cycle. But, importanly... if one (a high reward/low risk opp) never comes and POG merely trades in a $300 - $375 range over the next couple of years; which is very possible, if not even probable, given the beneifits of the Fed & Central Banks "controlling" POG during this difficult global economic recovery... one has to have an open mind that not only has the "Big & Easy Money" already been made in Gold...but, that the upcycle is now over & that we've seen the cyclical highs for both POG and Goldstocks. The Bottomline is that the most important nearterm upside catalyst for money flows into gold & goldstocks has just been buried beneath tons of rubble in Baghdad. Curious break between the Elliot Wavers & other TA players... interesting take here from Puplava's (Sinclair free-zone) site (vbg): financialsense.com